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Town Council to consider a loan from the county

Original post made by David Boyce, Almanac staff writer, on Feb 27, 2007

At its next meeting on Wednesday, Feb. 28, the Town Council of Portola Valley plans to talk about asking for a $4 million line of credit with San Mateo County so as to ensure that construction plans for a new Town Center complex -- a Town Hall, library, community hall and recreation facilities -- proceed on schedule.

The bid packages for the project are expected March 21, with decisions on the bids possibly ready a week later. This would allow construction to begin in June or July, said Mayor Ted Driscoll. Any delay in this schedule could result in a partial unroofed building(s) sitting in the rain next winter, Mr. Driscoll said.

The Portola Valley Community Fund has collected some $10.5 million in private donations for the $20 million project.

Other funds: The Town Council has set aside $3 million. The project budget includes $1.6 million for contingencies (still unallocated), the town receives about $400,000 more a year in property tax revenues than when this project started, and the town has about $1.8 million in additional property tax revenues obtained recently in a settlement with the county.

A loan may not be necessary. If one is, it might well be for less than $4 million. The council is likely to ask for an interest rate similar to what the county would normally earn on the money -- about 4 percent. The town would have up to 10 years to repay it, the mayor said.

Another way to complete the project's funding would be to ask the voters to approve a general obligation bond. This would require approval of two-thirds of the voters and would deeply engage the community, but the money probably would not be available in time for a summer groundbreaking and one of the buildings might be delayed by a year.

What do you think of this idea of the town borrowing up to $4 million? How would you prefer that the town obtain the money? Would it be worth it to you to exchange a delay for the community involvement inherent in an election for a general obligation bond measure?

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